2018 (12) TMI 1801 - AT - Customs

Levy of ADD - Imports of consignments of Polished Porcelein Vitrified Floor Tiles - Department contended that the imported goods cannot be treated as originating from Sri Lanka but rather to be treated to be originating from China. Therefore, the benefit of Notification No. 72/2005 is not available to the respondent and that they are however liable to pay anti-dumping duty. HELD THAT - The Learned DR for the Department has submitted that there is also an issue of anti-dumping duty in the case as at the relevant time there was anti-dumping duty notification on the Porcelein Tiles imported from China. However, we do not find that issue has neither been discussed in the impugned order which is before us for consideration nor the same is mentioned in the grounds of appeal filed by the Department. The only issue raised in the grounds of appeal by the Department is that the issue clarified that Sri Lankan authorities vide letter dated 22-12-2004 that the supplier do not import raw materials for manufacture of Porcelein Tiles, but they import semi-finished tiles, which has essential character of a finished tile for classification purpose. In the remand proceedings the Commissioner (Appeals) has observed that the benefit of notification is available to the respondents it appears that, though not explicitly stated the Commissioner (Appeals) held that the Notification No. 72/2005 is very much applicable even if the goods originated in China and that the products did not reach the stage in China whereupon anti-dumping duty could be imposed. As the issue of anti-dumping has not been specifically raised in the grounds of appeal, we are inclined to discuss the issue deeming it to be closed. Appeal dismissed - decided against Revenue.

Summary

Issues:
1. Interpretation of Notification No. 72/2005 for concessional rate of duty.
2. Classification of imported goods originating from China.
3. Anti-dumping duty applicability on imported goods from China.

Analysis:

1. Interpretation of Notification No. 72/2005 for concessional rate of duty:
The case involved an appeal by the Revenue against the Order-in-Appeal passed by the Commissioner of Customs (Appeals), Bangalore. The dispute centered around the origin of imported "Polished Porcelein Vitrified Floor Tiles" by the respondent, claimed to be from Sri Lanka. The Department argued that the goods should be considered to originate from China, making the respondent liable to pay anti-dumping duty. However, the Commissioner (Appeals) found that the respondents fulfilled the conditions for the concessional rate of duty under Notification No. 72/2005, thereby granting relief and setting aside the Order-in-Original.

2. Classification of imported goods originating from China:
The Department contended that the imported goods should be treated as originating from China based on investigations revealing that the supplier imported semi-finished tiles from China, which were then processed and polished in Sri Lanka. The Department argued that the goods did not qualify as originating from Sri Lanka, thus making the respondent liable for anti-dumping duty. However, the Commissioner (Appeals) determined that the goods fell under Heading 6907 and were eligible for the concessional rate of duty specified under Notification No. 72/2005, ultimately setting aside the original order and ruling in favor of the respondent.

3. Anti-dumping duty applicability on imported goods from China:
Although the Department raised concerns regarding the applicability of anti-dumping duty on the imported Porcelein Tiles from China, the issue was not explicitly discussed in the impugned order or the grounds of appeal. The Department highlighted a discrepancy in the classification of finished products and non-originating materials, as per Customs Tariff Rules. However, the Commissioner (Appeals) did not address this issue, and the Tribunal deemed it closed. Ultimately, the Tribunal upheld the impugned order, setting aside the Revenue's appeal.

In conclusion, the Tribunal upheld the Commissioner (Appeals)' decision, allowing the respondent the benefit of Notification No. 72/2005 for concessional duty rates on the imported goods, despite the origin dispute and the potential applicability of anti-dumping duty from China. The judgment emphasized the importance of fulfilling conditions for concessional rates and highlighted the need for proper documentation to support claims of origin under relevant customs regulations.